When you apply for a personal or any other easy loan in Singapore, the chances are that you would want to ideally maximise your chances of getting approved. When you need cash, there can be nothing more upsetting than having your loan request denied by a money lender. Hence, to ensure you skip the frustration of a surprise denial, it is crucial to understand the critical factors that money lenders consider when deciding whether to approve your loan application.
As one would know, your credit score is the most significant factor that money lenders look into, as your score provides many insights into your borrowing behaviour. However, it is best to keep in mind that credit score is not the only thing lenders take into consideration when deciding whether to approve your loan. If you are keen on learning how to ensure your loan gets approved, read on to find out four other essential factors that affect your chances of getting a loan approval;
As is the norm, money lenders often want to ensure that the individuals who obtain loans from them can sufficiently pay them back – and on time. Thus, when you apply for a loan, banks and other financial institutions are naturally quite concerned about the income you receive regularly. This helps the money lenders determine whether or not you have adequate income available to make loan payments.
For instance, if your total monthly income is at S$1,500 and you are seeking to obtain a loan that would have monthly payments of S$1,000, this would highly likely tell a money lender that you might have a hard time paying your loan. On the contrary, if your monthly income reaches S$5,000, and your loan would have payments of S$500 per month, you have a better chance of getting your loan approved.
2. Employment history
Income is a result of employment – if you are employed, the chances are that you most likely receive an income on a regular basis. For this reason, your employment history is critical to money lenders when deciding on your loan request. Often, these lenders would like to know whether or not you have a steady work situation or source of income. If you are likely to lose your job at any moment, your chances of getting loan approval are probably low.
3. Number of loans you applied for recently
Typically, a warning sign for money lenders is when you have submitted plenty of loan applications in a short period of time. If you have recently gone on a borrowing spree, lenders may become concerned that you will soon run out of road and default on your payments in the future.
Financial institutions can see how many loans you have recently applied for by looking at the number of inquiries on your credit report. Hence, as much as possible, it is recommended that you limit the number of loans you apply for or obtain.
4. Types of loans
There are many different types of loans based on one’s financial situation, including personal loans, business loans, payday loans, foreigner loans, and the like. These loans can be essentially categorised as either secured or unsecured loans. For many money lenders, secured loans are less risky because collateral will cover the costs if a borrower does not pay.
Secured loans can be guaranteed by various valuable collateral, such as money and other assets. Money lenders have a legal interest in these collaterals, which can be seized if you do not pay what you owe. Nonetheless, your loan approval becomes easier and much more likely if you obtain a secured loan instead of an unsecured one. Thus, if you prefer a property you can use as collateral, you may consider getting a secured loan.
Knowing the factors that affect your ability to get a loan and working your way around them is essential to ensuring that you obtain fast loan approval in Singapore. For the most reliable and hassle-free financial assistance to meet your urgent financial needs, Orange Credit has got you covered! We are a reputable Geylang money lender that offers a variety of easy, fast, and flexible loans for your every need. Get in touch with us today to find out more about our services.